Legislature on track to miss deadline for budget, which means another round of pink slip notices

Something might be going on in there.The Alaska State Capitol building as photographed in 2010. (Photo by Kimberly Vardeman/Creative Commons)

Update: Gov. Michael J. Dunleavy appears to be doing what he can to delay sending out layoff notices to state employees. In an email obtained by The Midnight Sun, Dunleavy says that the administration will wait until June 14 to give notice to employees. Under the contract the Alaska State Employees Association, the administration “shall make every effort to give written notice to the employee at least 30 calendar days in advance of the effective date of the layoff.” The bare minimum is 10 days. The email also says furloughs may be an option, which would allow the state to avoid immediately cashing out leave. Former Gov. Bill Walker sent notices to employees a full month ahead of time.

Thousands of state workers can soon expect to see layoff notices as deadlock over the dividend continues in Juneau.

Senate leadership alerted members on Tuesday that it won’t be holding a regular floor session until next Monday, which means there’s no chance to get a budget in place before the administration is required to notify state workers there could be potential layoffs. A budget must be in place by July 1 in order to avoid a government shutdown.

Labor contracts require employees get notices about potential layoffs ahead of time, and the first deadline is on June 3 with other waves closer to a potential shutdown.

Juneau Sen. Jesse Kiehl posted about the latest turn of events on his official Facebook page on Tuesday night.

“Senate leadership just announced no regular floor session until Monday,” Kiehl wrote. “That guarantees pink slips for thousands of dedicated public servants, even though there’s broad bipartisan agreement on the operating budget. It’s not right to make these Alaska families political pawns. I’ll keep working to get the budget to the floor—and the governor’s desk—as soon as possible.”

The operating budget is currently in the conference committee, which last met on May 14. Most of the work on the budget has been wrapped up, but with the size of the dividend still unsettled legislators have been reluctant to move the bill forward.

The House hoped to split the dividend from the overall operating budget, but the Senate included it at a full $3,000. The dividend could be taken up in a separate bill like the capital budget, which is still in the House Finance Committee and on the special session agenda.

While the 30 days the House spent without an organization could be blamed, Kiehl said in the comments of his post that it’s all about Senate impasse over the dividend.

“That’s what’s so infuriating. The legislature floored it after the governor’s total budget rewrite,” he wrote. “The conference committee was done TWO WEEKS ago, but Senate leadership can’t decide what to do about a PFD so they won’t bring up a vote.”

Senate President Cathy Giessel, R-Anchorage, told KTOO last week that the Senate is working with Gov. Michael J. Dunleavy to come to an agreement on the dividend before it reaches his desk.

“We are still in discussions with the governor trying to reach a conclusion to that,” she told the station. “It is not our intention that any teachers, troopers or truck drivers get pink slips this year. There’s no reason for it. We need to reach agreement with the governor, and that’s what we’re endeavoring to do.”

The Dunleavy administration has been relatively silent about the looming deadline compared to former Gov. Bill Walker, who sent enough rounds of layoff notices that his final State of the State address was titled “State Workers Deserve Praise, Not Pink Slips.”

A spokesman for the administration told KTOO that they also want to avoid a layoff, but as for details about the pending notices said “that’s not information that’s publicly out there.”


The layoff notices will only go to specific state employees whose contracts require a month’s warning. Other employees have a shorter window for layoff notices.

Teachers, who are not directly employed by the state government though they’re funded in part by the state, face a more complicated outlook for pink slips.

Legislators had hoped to completely avoid pink slip worries for teachers when they included funding for the upcoming fiscal year in last year’s budget. That funding, though, is now facing its own uncertainty as the governor insists the funding mechanism used in last year’s budget is unconstitutional.

Though the courts haven’t struck down the funding as invalid and there’s no pending litigation to do so, the administration has indicated that it plans to withhold the funding anyways. Under state law, monthly payments to districts would start on July 15.

The Legislature took action on Tuesday to prepare to sue the governor if he follows through with his threats over school funding. Giessel told reporters Tuesday that the Legislature could seek a court order to release the funds to school districts ahead of the case’s resolution.

The public school system is one of the few state services required by the Alaska Constitution.

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